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Archive for August, 2015

SW Florida Listings Might Echo U.S. Trend toward Less Luxury. Just as with movie credits, the features you find in SW Florida listings have a “billing order.” The “stars” may not be printed in gigantic superstar type—but the order in which they appear do reflect changes in current buyer priorities. For a homeowner soon to add their property to this spring’s SW Florida listings, it’s important to learn which features currently tend to attract the most favorable attention from prospective buyers. It’s of more than marketing interest, as well: knowing what’s in and what out can also help determine where improvement dollars should go. The question is, which features are most desirable, and which formerly popular features have become passé: “so Twentieth Century!” New answers to these questions usually appear a couple of times a year—and 2015 is no exception. The latest one I found was on the Realtor.com website. It went into recent history, describing in detail how listings’ features for newly-built homes have been undergoing rapid change over the past few years. In general (and probably as a reaction to the difficult economic times that only lately have seen improvement), over-the-top luxury details are fading, being replaced in favor of features centered on efficiency, organization, and pragmatism.Examples of the kinds of details less likely to be found in today’s listings are two-story foyers, master bathrooms with whirlpool tubs, and luxurious details like outdoor kitchens. (“NOPE” in capital letters is shown stenciled over a picture of one of those outdoor kitchens…which, I have to admit, really does look like it belongs in a hotel). Whereas ten years ago, those outdoor kitchens with fancy wine racks might have been found near the top of a listing, today it might be replaced by ‘walk-in closets’ or even, simply, a ‘laundry room.’ “It’s not sexy,” says one industry executive, “but that’s what people want.”The most extensive survey of home builder trends is conducted by their national association, the NAHB. By quizzing nearly 400 builders, they concluded that other features on the decline include outdoor fireplaces, sunrooms, and media rooms. Taking their places (and likely candidates for what we’ll soon see creeping toward the tops of some of our SW Florida listings) are the walk-in closets (since people want to get out the door efficiently first thing in the morning) and well-organized and well-lit laundry rooms (to improve the efficiency of the household).As part of a “post-recession cultural shift toward pragmatism,” this makes perfect sense. But that word “post-recession” may offer a clue to what could be the temporary nature of the NAHB’s 2015 findings. For example, granite countertops—once a ‘luxury’ item in SW Florida listings—are now more popular than the laminate alternatives. And those supposedly unpopular media rooms are not vanishing totally. They’re simply being replaced by spaces that are “more flexible.”SW Florida Listings Might Echo U.S. Trend toward Less Luxury. If you’re soon to be scrutinizing your own home to determine which of its best features to emphasize, I’d be pleased to furnish an opinion—it will be based on the results we’re seeing from today’s SW Florida listings!

Here is a one-question True or False exam that every future SW Florida first-time home buyer should take: True or False:One sure way to build a strong credit report is to pay your bills on time.(Answer: False)

_________________________________________________________________SW Florida Home Buyers Should Check on Credit Report Inclusions. Particularly for a first-time SW Florida home buyer, being able to present a strong credit report can make the difference between being able to afford a quality home that satisfies all your ‘must haves’—or one you just sort of settle for. It’s about how much you can comfortably afford. The interest rate you will be offered is directly related to your bill-paying history, and a percentage point (or more) can make a big difference in your monthly budget. Because lending institutions charge more or less based upon the degree of risk they believe a loan carries, the stronger your credit report, the “more house” your monthly payment will cover.Of course, since a string of unbroken records of punctual payments is what lenders look for, you might think that the answer to my one-question True or False exam would be an unqualified ‘True’—but not so fast. There’s a small catch is in the unbroken records that they look for. The word records. Just paying your bills on time doesn’t build a strong credit report unless there are records of it—and for SW Florida first-timers who have been paying rent for years, all those prompt payments could well be missing in action. The surprising reason lies in the nature of our whole credit reporting system.It’s voluntary. As the L.A. Times spotlighted last summer, landlords, phone and cable companies, “and many other creditors don’t report your payments” to the big three credit bureaus (Equifax, Experian and TransUnion). They aren’t required to do so. If you’re planning on becoming one of our SW Florida first-time home buyers, that might be a big deal—especially since rent payments usually make up the lion’s share of what you buy on credit. But you can do something about it!Recognizing the difficulty some first timers were having in qualifying for home loans precisely because of such missing data, about five years ago, the credit bureaus teamed up with services like RentTrack that enable tenants to pay their rents online—and get credit for them. TransUnion and Experian also introduced services like “ResidentCredit” and “RentBureau” that encourage property managers to report rent payments for their tenants. That makes sense for landlords, too, because when rent payments are recorded, it enables them to better gauge the creditworthiness of their next batch of applicants. SW Florida Home Buyers Should Check on Credit Report Inclusions. Making sure your payments are being recorded will put today’s renters ahead of the game when they eventually decide they’re ready for the next step: home ownership. It simplifies the answer to that One-Question True or False credit report question greatly…to a simple “True”!

Real Estate News (in Case You Thought You’d Heard it All) SW Florida. SW Florida real estate news is fairly predictable—at least compared with some of the stories that filter in from the rest of the world. Here in SW Florida, for instance, wherever a new home is being built, you’re likely to see familiar evidence like stacks of lumber and drywall, cartons of nail gun ammo, sacks of cement, and workmen hustling around as they put everything together. Nary a printer in sight.Not so in China. According to The Washington Post, the real estate news includes an item about an innovation from Asia. “Innovation” is perhaps a bit of an understatement, because the gist of the story was that in April a little over a year ago, a Chinese concern built 10 houses in one day using a 3-D printer. Despite what you may be thinking, this item did not have an April 1 dateline.The 3-D printers we’ve been reading about over the past few years are the ones that take pellets or powders made of plastic, wax, ceramic, or even metal, and print three-dimensional objects, layer by layer, as directed by a computer. Only a few years back, for most of us, stories about 3-D printers seemed more like science fiction than reality. But apparently the things actually work! As evidence, there have been lots of stories about the legal and other ramifications that accompany the printing of firearms. A few months ago, astronauts printed up a 3D wrench aboard the International Space Station: they’ll just print up spare parts when things break down. And there was that car (the “Strati”) that a company printed in Chicago: it took 44 hours to print, with a top speed of 40 MPH…Doesn’t this all sound a little bit nuts?But back to the real estate news from China. It seems that the outfit that printed the 10 houses last year, built a really, really big 3D printer, and used it to print a mansion: an 11,840 square-foot villa. Next to it, they printed up a 5-story building (just showing off, you have to think). According to reports, the process is more than just fast: it’s becoming cheaper and more energy-efficient. The Chinese company says that it can save 30%-60% of building materials, 50% of labor costs, etc. They want to print bridges, too…But don’t think American ingenuity is being left in the polymer dust! USC Engineering Professor B. Khoshnevis is plugging away at the forefront of the technology, except he calls it “contour crafting” instead of “3D printing” (or “Xeroxing”). On his website, in answer to the FAQ “Can you print an entire house?” the answer is Theoretically, yes. He hopes to see “entry-level construction models on the market within one to two years.”Real Estate News (in Case You Thought You’d Heard it All) SW Florida. Soooo, how long before our local SW Florida real estate news will be trumpeting our own 3D printed houses for sale? No time soon. It turns out that the villa, 10 small houses, and 5-story apartment building in China “aren’t much to look at.” In fact, some say they are for demonstration only. So when you give me a call to help you find the SW Florida home of your dreams, I suspect a printed model won’t be on our tour list. We won’t be making the rounds in a Strati, any time soon, either. It’s only a two-seater, anyway.

SW Florida First-Timers Needn’t Shy Away from Their First Home Purchase. They really ought to teach this stuff in school: real-life, day-to-day economics. SW Florida youngsters out on their own for the first time are usually left to trial and error when it comes to mastering things like how to lay out a personal budget or use credit advantageously. Or even how to go about selecting a bank, or opening a checking account… So when it comes to buying their first SW Florida home, it’s very common for newcomers to put off confronting the whole daunting issue. When you’re still new to your career, tackling a purchase involving years’ worth of income channeled through a maze of unfamiliar procedures is easy to put off. But when the delay stretches well past the point in their financial lives when it would be clearly advantageous to own rather than to continue renting, it’s the same thing as throwing hard-earned cash overboard. They really ought to teach this stuff in school! That having been said, here is a broad-brush, very basic rundown of the lay of the land aimed at first time SW Florida home buyers: Since the asking price for even the most modest SW Florida home is a number with multiple zeros on the end, you might assume that common sense indicates it’s out of reach. All the more so if early mistakes handling credit cards or student loan troubles have damaged your credit score. The good news is that potential home buyers with less than outstanding credit can still buy that first home—given some careful financial planning and research on your part.• The most important factor banks use to determine your mortgage eligibility is your FICO (Fair Isaac Corporation) credit score. The numbers range from 300 to 850, are based on a number of factors including how much debt you have and your payment history. In general, borrowers will need a credit score of at least 650 to qualify for a conventional home mortgage loan.• BUT, it’s not the only factor. Although your credit score tops the list of elements that determine your eligibility for a mortgage, banks will also consider the amount of money you can commit to a down payment. Saving up may delay your first home purchase, and definitely takes discipline…but today, the amount you need is changing. Different lending institutions have different rules for determining eligibility, and some offer-• Non-conventional loans. Today, first-time home buyers with relatively low credit scores can often secure such loans. You should research SW Florida banks to find those currently offering non-conventional loans to borrowers with qualifying credit histories. You should also consider a Federal Housing Authority (FHA) loan, which eases credit requirements. For example, you might qualify for a FHA loan with a credit score as low as 580 with a down payment of just 3.5%! • You can also use money from an IRA for your down payment. In other circumstances, withdrawing money from your IRA before age 59 ½ means paying a 10% penalty, but that rule doesn’t apply when you use your IRA to purchase a first home! SW Florida First-Timers Needn’t Shy Away from Their First Home Purchase. Bottom line: a low credit score doesn’t necessarily mean you can’t buy your first SW Florida home. I’m here not only to help you find a home, but to help clarify the options that make possible that dream of owning your first home. Call me anytime!

Overcoming Rival Bids in Today’s SW Florida Real Estate Market Tips. It was only a few years ago that the last thing a prospective SW Florida home buyer had to worry about was being outbid. Those were the days when the bottom seemed to be falling out of the SW Florida real estate market. Anyone brave enough to be looking to buy at a time when the real estate market was frightening most folks away was not only plucky—they were also alone. Sellers who had to move no matter what found themselves forced to accept offers that they knew were well below their property’s true utilitarian value. The only saving grace was that those same sellers could turn around and buy in their new community at the same kind of crazy discount. That, as they say, was then—and this is now. As the real estate market in SW Florida continues to revive, sellers’ mindsets have returned to normal. Knowing that their SW Florida home is a valuable commodity, they demand offers that are respectable. One national survey found that buyers are acting quickly on the most sought-after homes, and that overall, median DoMs (Days on Market) fell to 32 in March from 40 just a month earlier. As the spring selling season heats up, some buyers who find the home of their dreams may also suspect that they aren’t alone. It calls for definitive action—and if it looks as if just making an offer might not win the day, some additional action. For home buyers who have a good idea that they must act decisively or miss out, here are some options for increasing the odds that their offer will be accepted: One tactic to prevent being outbid is to add an escalation clause to the offer. If allowed, such a provision states if the seller receives another offer, then the buyers are willing to increase their own offer to a set price. For instance, a home buyer who makes an offer of $310,000 might include an escalation clause in increments of $3,000 should a competing offer appears, up to a maximum of $360,000.Since people have different reasons for selling their home, another tactic is to discover what’s important to the seller. Perhaps they have a new job opportunity and need to vacate as quickly as possible. Or maybe they have plenty of time, and are holding out for the maximum price. Your agent may have a good idea what is motivating the sellers so that you can craft your offer around their requirements. If a normal schedule calls for an inspection period of 10 days, but the sellers want to move quickly, they may be motivated by a shorter inspection period. Usually, home buyers find it prudent to keep the upfront earnest money pledged to a minimum, allowing them more leeway in limiting their loss if they decide to back away from the deal. Increasing the earnest money shows the sellers you are serious about completing the purchase. It also subtly affirms your financial stability. An even more substantial demonstration is to become pre-qualified with a mortgage lender. Unless an all-cash purchase is possible, it’s the best way to guarantee you will be able to act quickly. Even if competitive bidders appear, when you are a pre-qualified buyer, you increase your chances of winning out.Overcoming Rival Bids in Today’s SW Florida Real Estate Market Tips. When I’m tapped to act as your buyer’s agent, I become your advance scout and strategic partner as you explore this spring’s exciting SW Florida real estate market. I hope you’ll give me a call!

Mortgage Credit in SW Florida Should Ease after Clarification. How easy or hard it is for SW Florida home buyers to secure a mortgage with attractive terms is a key element in the local real estate picture. SW Florida mortgage credit provides the oil that keeps residential home sales moving smoothly; that, or it becomes a damper (or even something close to an emergency brake!).The SW Florida mortgage credit situation is largely a reflection of what’s going on in the greater financial world, where the corporate banking interests, world economic conditions, and political realities converge. It is in that greater arena where the counterproductive effects of tightening mortgage credit availability have been acknowledged for some time. At first, it seemed to be little more than talk, but recently, changes have been stirring. The resulting tinkering seems to be taking effect.“U.S. consumers are finding it easier to get a mortgage,” was last Thursday’s finding by CNBC in their Reality Check. The commentary was headlined “A CREDIT THAW IS OFFERING MORE MORTGAGE OPTIONS.” In fact, it fairly bristled with refrigeration metaphors. Following “years of near frozen credit following the financial crisis” there was now “heat behind the credit thaw.” If you expected that the source of the heat was the springtime improvement in SW Florida’s weather, you were mistaken. It was “simple clarification.”Clarification.The simple clarification lies in a chain of repercussions that requires some clarification of their own. It has to do with the usual suspects: Fannie and Freddie. Fannie Mae and Freddie Mac (the guarantors behind the majority of mortgage credit in SW Florida and throughout the country) had sued lenders left and right following the subprime mortgage market mess. It cost the banks and mortgage companies billions through lawsuits and loan buybacks. Lenders, who like many of us don’t like to lose billions, became understandably gun-shy. They demanded near-pristine credit from borrowers, because they didn’t want Fannie and Freddie (and sometimes their Uncle, Sam) to come after them again.Bait-and-GoodbyeRates may have been terrific, but for way too many SW Florida would-be borrowers, those rates were attached to loans that weren’t being offered. It wasn’t exactly Bait-and-Switch; more like Bait-and-Goodbye. But new rules that clarify which loans are considered safe by the semi-governmental concerns have done away with a considerable degree of lender concern. Added to the nationwide increase in activity (the Mortgage Bankers Association registered a single month increase of 17% in new home applications in March), it seems likely that the defrosting described by CNBC should continue well past cherry blossom time. Mortgage Credit in SW Florida Should Ease after Clarification. Today’s SW Florida mortgage credit landscape is something that directly affects most buyer-applicants as well as SW Florida home sellers, so that’s welcome news—and a good reason why now is a good time to give me a call!

SW Florida Homeowners Association Rules are well worth the Read! It does seem that whenever a story about some faraway homeowners association finds its way into SW Florida newspapers, nearly always it’s because something has gone awry. Either there’s an ongoing dispute about a flag display (“Indiana Couple Violate Rules for Flying U.S. Flag”), a fencing disagreement (“Border Feud is Childish and Dangerous”), or something else to catch readers’ eyes. The pettier, the better (“North Carolina Man in Dispute over Pansies Planted in Common Area”). Why does this hit the local news? Let’s face it: it is sort of fun to read about!The downside is that when those instances are all we hear about, it can lead SW Florida buyers to believe they should stay away properties with HOAs when they are buying a home. But the fact is, town homeowners associations exist to protect the common interests of owners and residents. Homeowners associations can and do offer many benefits. The key is understanding what they are, what the costs are—then choosing the right association.Know the RulesThe first step in evaluating any SW Florida homeowner’s association is to thoroughly examine a current copy of its rules. When you realize that it’s natural to focus on the individual property instead of the community, it’s more understandablewhy many prospective buyers pay too little attention to this step. Later, they may find themselves in violation of rules they should have noted before. Those stories about flags are typical: usually the problem was not with the flag, but with rules about flagpoles. Small details can become big problems when the homeowners association ‘covenants, conditions and restrictions’ remain unread in a kitchen drawer.Comparing Costs and AmenitiesIn addition to the rules of a contending SW Florida homeowners association, there is the matter of its fee structure. Older homeowners associations are often (not always) less expensive than newer HOAs. Yet price is not the whole picture. Especially when evaluating two or more associations, it’s time to sharpen a pencil and compare what the fees cover. One association may include lawn maintenance, while another leaves that as your responsibility…and there may be value for the community (and your property’s resale value) in guaranteeing proper maintenance by everyone. One HOA may have a pool, tennis courts and other amenities, while another may only offer a community room. Newer SW Florida homeowner associations are tending to offer more features, but not always. SW Florida Homeowners Association Rules are well worth the Read! Homeowner’s associations offer a sense of community along with amenities and other benefits…but for some, the cost in individuality weighs against it. When I’m invited to be your real estate representative, I help you ask the right questions—the ones that will guide you to a new home that’s the right fit for your family. I hope you’ll give me a call!

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